Changing Lifestyles : Wanted: Place to Relocate 10,000 Street Vendors : Mexico City is ejecting peddlers and building permanent sites for them. As always, there are winners and losers.

Many said it couldn’t be done--this revolutionary concept of ejecting about 10,000 street vendors from the anarchic capital’s historic core, where narrow, colonial-era passages were long ago ceded to peddlers whose rickety stands are arrayed beneath makeshift plastic canopies.

Just as U.S. shoppers flock to suburban malls, Mexico City residents, known as capitalinos , have traditionally descended on the throbbing district to purchase everything from clothing to televisions, medicines to stationery, foodstuffs to toys--all at bargain prices, thanks to the vendors’ minimal overhead.

The government’s plan for mass eviction met predictably fierce initial resistance from vendors, their politically powerful leaders and the many police and other authorities who have thrived from payoffs.

“A lot of people thought this would be impossible,” said Mexico City Mayor Manuel Camacho Solis, who championed the move as necessary to rescue the district from further deterioration.

But the sprawling outdoor bazaar was successfully disassembled and moved elsewhere as of Sept. 1, and the job was done without violence or major upheaval in the world’s most populated metropolis.

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Today, the serpentine avenues of the approximately two-mile square patch of downtown are once again passable.

For Mayor Camacho and his allies, the relocation stands as a victory for negotiation and modernization, a microcosm of the economic sea-changes that are transforming this nation on the eve of a new era of North American free trade.

“The historic center was becoming a slum,” the mayor said. “We faced the danger of being divided into two cities.” Now, officials here hint, Los Angeles, New York and other First World cities trying to come to grips with Third World street vendors might take heed of Mexico City’s experience.

“What we’re doing is incorporating this vast underground economy into the mainstream,” declared Roberto Albores Guillen, the city official who coordinated the move. “This is without precedent in Mexico.”

Since Aztec times, vendors have cluttered the nation’s central plazas, or zocalos , and streets, hawking their wares.

Colonial viceroys despaired at ever clearing the mostly indigenous entrepreneurs from Mexico City’s zocalo. While the underground economy of street sales is technically illegal, it is the only alternative for many citizens unable to find adequate employment.

The 10,000 evicted center-city vendors are slated to occupy more than two dozen new fixed markets, financed with government-guaranteed, low-interest, long-term loans. Officials say the program will cost almost $200 million.

Apart from the human drama, the move has been a massive logistics challenge, forcing planners to find a stall for each of the independent vendors in an already impossibly crowded city.

Today, optimistic officials brag of the future benefits: legal status for vendors, ownership, regular water, gas and electric service, security, parking and the like.

But many vendors are now marooned on unfamiliar streets and other sites far from the inner city, suffering losses while waiting to occupy the permanent markets.

“We can’t sell anything here,” complained Almadelia Peralta Martinez, who, along with her husband (both of whom are blind), offers key chains, flashlights and other made-in-China items from a makeshift display table on a busy street about a mile from her former site in the historic center.

Like others, she yearns to return to the city center and is pessimistic about ever recouping her losses, even once installed in a permanent marketplace.

Accustomed to a life on the heavily trafficked thoroughfares of the city center, many are equally skeptical that they will be able to thrive in formal locales.

“Maybe this is a great success for the mayor, but it’s a disaster for us,” said Leon Irigoyen, a 40-year-old vendor who sells portable stereos, telephones, televisions and other electronic goods.

A former southern California restaurant worker, Irigoyen says he abandoned his life as an illegal immigrant and returned to Mexico five years ago so that he could be reunited with his wife and two children, who never left. He opted for the life of a street vendor because of the general unreliability of other employment here and the low pay. (Minimum-wage earners typically earn about $5 a day.)

Instead, with his savings from el norte , Irigoyen bought an inventory and went into business on the streets, where he says he earned $50 or more in a good day.

But five years later, “I’m just making enough to feed my family,” he said, disgusted at the relocation.

The move has also triggered collateral resentment among shopkeepers whose streets have abruptly been invaded by vendors jettisoned from downtown.

Store-owners who pay rent, taxes and other costs for the privilege of doing business resent the arrival of the low-cost competition. Riot police have had to break up disputes between newly arriving vendors and established businesses.

“The ‘invasion’ has been very bad for our business,” said Graciela Calderon, who runs a stationery store off a street now lined with dislocated vendors, some of whom sell pens and paper goods. She said her business is down by one-third.

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According to city officials, the difficulties are merely growing pains that will be rectified as the new commercial complexes are completed. Authorities are conducting a public relations blitz aimed at attracting business to the new plazas.

“The people will come,” vowed Albores, the city official running the program. “In the end, everyone will be better off.”

Indeed, for a minority of fortunate vendors, the move has clearly signaled a deliverance of sorts, transforming them from itinerant peddlers subject to constant police shakedowns to established merchants with fixed stands that many will eventually own.

Under agreements hammered out in negotiations, most put down the equivalent of about $1,000 and continue paying an additional $100 or so per month for the right to sell at the new emporia.

“Finally, I have my own place, and I have a legal right to be here,” Maria Chavero Angeles, a vendor for more than half a century, said proudly as she surveyed a multicolored selection of handkerchiefs laid out in her cramped stall in a bustling new market here.

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She and about 400 other street vendors relocated to the imposing new Pino Suarez Commerical Plaza are the fortunate ones. Their mall, completed in May, is next to a busy downtown subway stop.

“Here, when I see police, I know that they’re here to protect us, not harass us,” said Joaquin Gonzalez, 64, a jewelry salesman who left a factory job a dozen years ago to take his chances on the streets.

That their fortunes have turned for the better is a testament to the foresight and clout of their confederation, the Assn. of Small, Semi-Fixed, Unsalaried Merchants.

“We knew that we would have to leave the streets eventually, so we have had our eyes on this site for a long time,” said Benita Chavarria Flores, mother of 10, second-generation street vendor and the group’s general secretary.

Through newspaper advertisements, marches, petitions and other pressure tactics, her group lobbied officials, seeking government land for construction of the plaza. The group ultimately gained the site concession.

The association is one of about 60 such organizations that represent the former historic-center vendors. The various leaders have long served as intermediaries between the vendors and bribe-seeking officials, cutting deals to allow members to stay in business. Many leaders have prospered and formed veritable empires, allying themselves with political parties.

“What we’re most proud of is that we avoided confrontations and violence,” Mayor Camacho said in an interview.

For Camacho, the initiative was fraught with political risks.

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The Princeton-educated chief city executive, a longtime associate of President Carlos Salinas de Gortari, is considered one of the leading contenders to replace the president in next year’s election.

His seemingly successful brokering of the street vendor issue is widely viewed as a coup for a technocrat who had already achieved a considerable reputation as a political go-between during the disastrous earthquake that shook this city eight years ago.